Sydney Kawadza in Malabo, Equatorial Guinea
Government’s fiscal consolidation measures and other initiatives introduced into Zimbabwe’s economic programmes should see prices of goods starting to drop from next month, Finance and Economic Development Minister Professor Mthuli Ncube has said.
In a pre-recorded Governors’ Statement released here during the 54th Meeting of the Boards of Governors of the African Development Bank (AfDB) and the 45th Annual Meeting of the African Development Fund underway at Sipopo Conference Centre, Prof Ncube said reforms introduced under the Transitional Stabilisation Programme (TSP) were starting to bear fruit.
“The reforms being implemented by Government under the Transitional Stabilisation Programme of October 2018 to 2020, are beginning to show positive developments as the twin deficit challenge of the fiscal and the current account are coming under control.
“Government has started realising a budget surplus. On the other hand, with regards to prices, fiscal consolidation measures, reinforced with a tight monetary stance together with liberalisation of the exchange rate are containing inflationary pressures which are expected to slow down in the third quarter of the year.”
Prof Ncube said the positive trajectory was achieved through containing expenditures by reducing the wage bill and plugging revenue leakages through improving the Zimbabwe Revenue Authority (ZIMRA)’s Tax Management Revenue System, and revenue enhancement measures such as a two percent Intermediated Money Transfer Tax, among others.
The 2019 Budget, Prof Ncube said, primarily targeted macro-economic and fiscal stabilisation and implementation of quick win flagship and high impact projects and programmes, which will lay a solid foundation for private sector led growth.
He however, reiterated that the 2019 GDP growth rate was expected to be weighed down due to unfavourable El-Nino induced drought, the devastating Cyclone Idai, foreign currency shortages and constrained spending being imposed by fiscal reforms.
“In addition, challenges in fuel and electricity availability are also factors weighing down economic performance,” he said.
The Annual Meetings are the AFDB’s largest event bringing together 3 000 delegates and participants and are being held under the theme: “Regional Integration for Africa’s Economic Prosperity”.
They also provide a unique forum for representatives of governments, businesses, civil society, think tanks, academia and the media worldwide, to dialogue on key issues concerning Africa’s development.
Professor Ncube said Zimbabwe, through the TSP, is also developing strategies to promote its integration with regional and continental bodies through various programmes including establishment of the “One Stop Shop” Zimbabwe Investment Development Agency (ZIDA); accelerate the ease and cost of doing business reforms and the promotion of Joint Ventures in infrastructure projects.
The initiatives also include the implementation of Special Economic Zones; streamlining regulations and policies affecting export processes and manufacturing in general and supporting the activities of SMEs by promoting linkages with the rest of the business world, and in particular Africa.
“Zimbabwe has also prioritised implementation of the SADC, COMESA and Africa Union integration strategies that promotes the development of shared infrastructure among other initiatives.
“Government is (also) prioritising re-engagement with the international community to attract Foreign Direct Investment (FDI) under the dictum “Zimbabwe is Now Open for Business”.”
He also took time to pay tribute to the AFDB Group and development partners for their swift response towards the Cyclone Idai disaster that hit some parts of Zimbabwe, Mozambique and Malawi.
In Zimbabwe, Cyclone Idai hit the four provinces, Manicaland, Masvingo, Midlands and Mashonaland East, with the most affected areas being Chimanimani and Chipinge Districts where approximately 344 people lost their lives.